This is the 3rd Daily Golden Nugget in my series on Segmentation and understanding how to better target your customers. In this Nugget I'll explain how you can organize your previous customers and target them through emails.

To start with you will need to run a customer report from your point of sale software. Specifically you want to see your customers listed by the product type that they purchased. The date range of the report should be at least 12 months, but you will have more options in the next step with a report with a longer range. The goal of this report is to view your customers according to the product that they previously purchased. Frequent buying customers should be listed under different categories of this report.

This report by itself represents a segmentation of your customers according to the jewelry products they like. In the future when you add new pearl earrings to your inventory you could use this report to notify all the previous buyers of pearl earrings, or just earrings in general.

Admittedly I'm being a little cavalier in saying "notify all the previous buyers" because I'm assuming that you actually have their home address to send direct mail, or their email. Naturally email is easier to target market to, but old-fashioned snail mail is still good... depending on your approach.

Getting back to the segmented list... Under normal circumstances you would have a generic email or direct mail piece for your store. With this segmented list you now have a better chance to make a sale based on previous products that someone purchased. Instead of sending the same message to all your customers you would send out different emails to each segmented groups of customers.

Your response rate will be much higher.

Getting back to that pearl earring example above, the ad you send to all previous earring buyers could include the new pearl earring style and the matching pendant. That same ad could then be used for the segmented group of customers that previously purchased pendants, and even those who have previously purchased any type of pearl jewelry.

The bottom line of this Daily Golden Nugget is to show you how easily it actually is to organize your existing customers into different groups, and then solicit those groups. When you use the same ad for everyone you will be lucky to get a 2% response rate. With segmented marketing you have a much higher return because your audience is narrowed to the already interested.

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